Drop in delinquencies amongst Australian homeowners
According to figures released by a leading credit ratings agency the level of mortgage delinquencies amongst homeowners in Australia has been falling.
With the global financial crisis, the problems that have hit the property sector, and the recession, finances have been difficult for most households in Australia for some time, and these financial difficulties have resulted in many people missing out on repayments on both unsecured debts and even on their mortgage loans, as many have struggled to make ends meet.
However, a leading credit ratings agency has recently released figures that indicate that there has been improvement in the level of mortgage related delinquencies seen amongst homeowners in Australia. According to the figures released by Fitch Ratings the level of mortgage delinquencies in Australia have fallen between the first quarter of the year and the second quarter.
Officials have said that one of the main factors that has enabled homeowners to keep up with repayments on their mortgages is the low interest rate, which plunged from seven and a quarter percent last year to just three percent by April of this year, giving homeowners more money and making it easier to make their mortgage repayments.
Leanne Vallelonga, associate director in Fitch’s structured finance RMBS team, said: “This continues the trend of decreasing arrears achieved so far in 2009, and suggests that peak arrears were reached in Q4 ‘08. Fitch does not expect to see those same levels of arrears for the remainder of 2009.” She added that this had also been helped by relatively strong employment levels, stating: “Australia has fared better than most other countries during the global financial crisis; and whilst uncertainty remains about a global recovery, unemployment in Australia remains at half the levels of the early 1990s, 11-12 per cent range in the depths of the last recession, and the outlook for borrowers is stable for the remainder of 2009.”
Source - ABC